The Government plans to bring a new legislation for price control and monitoring of drugs, replacing the existing regulatory framework, to meet the requirements of the new pharmaceutical pricing policy.

According to the National Pharmaceutical Pricing Policy, 2012 (NPPP-2012), a new Drugs Price Control Order (DPCO) would be notified as soon as possible after the notification of the new policy. It will, however, be replaced but over a period of

time.

"In due course, however, the Drugs Price Control Order, which is presently mandated under the Essential Commodities Act, would be replaced by specific legislation covering the issue of price control and monitoring of drugs, which would be fine tuned to the requirements of the drugs regulatory regime," the Ministry of Chemicals and Fertilisers said in the policy document, NPPP-2012.

The new policy, which was cleared by the government last month and would bring 348 essential drugs under price control, has been tabled in both houses of the Parliament last week.

According to it, the National Pharmaceuticals Pricing Authority (NPPA) will be the implementation authority for the new policy and the new DPCO.

"The NPPA would be provided required organisational and financial support so as to enable it to implement the new policy in an effective, speedy and transparent manner," it added.

As per the new drugs policy, all strengths and dosages specified in the National List of Essential Medicines (NLEM) 2011 will be under price control.

Also, the ceiling prices (CP) of the drugs will be fixed on the basis of market-based data.

According to the policy, ceiling price of the NLEM medicines will be fixed by adopting the simple average price of all the brands having market share more than and equal to 1 per cent of the total turnover of that medicine.

Price control over drugs was first introduced in the country in the aftermath of the Chinese aggression by Drugs (Display of Prices) Order 1962 and the Drugs (Control of Prices) Order 1963.

The existing drug policy of 1994, which covers 74 bulk drugs, was implemented through Drugs Price Control Order (DPCO) 1995.